Guests: Rachel Maddow, Sen. Bernie Sanders, John Nichols, Dan Dicker
ED SCHULTZ, HOST: Good evening, Americans. And welcome to THE ED SHOW, from 30 Rock in New York City.
You know, you can tell a lot about a country‘s priorities by just seeing what we‘re willing to pay for. The details on last Friday‘s compromised budget are out and let me tell you, it‘s not pretty. There‘s a lot of hurt. We‘re about to spend more money on defense and slash funds for the defenseless. I got something to say about that tonight.
This is THE ED SHOW. Let‘s get to work.
SCHULTZ (voice-over): Tonight, Senator Bernie Sanders on the budget, he says, steals from the poor to give to the rich.
Tomorrow‘s defining moment for Barack Obama. Will the president open the door for Republicans to slash entitlements? Rachel Maddow is here to discuss that story with me.
Nightmare on the tarmac. Maybe it‘s not such a good idea to trim back on that FAA budget.
And Scott Walker is hitching a ride on the campaign money train. I‘ll tell you about the Wisconsin governor‘s latest political scandal.
SCHULTZ: Oh, we got a lot coming up tonight.
But, this is the story that has me fired up first tonight: Tomorrow, the House will vote on the largest spending cut in the history of the country. Think about that—spending cuts. Everybody loves cuts, right? Because we‘re going to be fiscally responsible and we‘re just going to cut our way into profit.
It‘s the largest—not under a Democratic president—it‘s the largest cut.
And, of course, this is the devil in the detail time for the American people because they had to do this to avert a government shutdown last Friday.
Well, the details are out this morning. Let‘s start with $38 billion in cuts. What does that include? Well, should we say happy birthday to the Koch brothers tonight? What do you think?
The Environmental Protection Agency is going to give up 16 percent of its budget, $1.6 billion.
I had to put this on card tonight because there was just so much stuff here. Renewable energy, $438 million? Are you kidding me? Well that‘s all part of drill baby drill. That‘s what that is.
Oh, let‘s see now, we‘ve got—let‘s hit the U.S. Fish and Wildlife Service. The enviros, they love it. You know, they love the U.S. Fish and Wildlife Service. So, the righties, they‘d love to hit them. They‘re going to serve up $150 million. OK?
You boys out there in rural America who are Tea Partiers, you think that your water is all clean? Guess what? You got to serve up $80 million in rural water development. You know, clean water, it‘s kind of important. That‘s on there.
Let‘s not forget environmental quality incentives for businesses—businesses that decide to do things that are good for the environment, those incentives are out there, going to get cut $80 million.
Let‘s just keep going down the list. Agriculture is going to get hit
emissions control monitoring. You know, those government agencies that make sure there aren‘t any cheaters out there. That‘s going to take millions of dollars right out of the budget.
See, there‘s just so much there. Well, wait a minute. There‘s a lot more.
FEMA first responders—that program is going to cut $786 million.
The FEMA first responders.
Now, I just thought I‘d pull out some hometown video tonight. This, of course, is Fargo, North Dakota. They‘re fighting a flood for the umpteenth time, another record flood and whatnot.
And FEMA always shows up. But you know what? They‘re going to get cut.
The medical assistance, the search and rescue—every governor that goes through a disaster always calls for FEMA assistance. But I guess they‘re going to get a busy signal now or somebody is going to take it off the hook because nobody is going to be there to answer it. They‘re going to cut FEMA big time. You can count on that.
Well, that‘s only $786 million. That‘s chump change, isn‘t it, to the Republicans?
Let‘s talk about the cops program. That‘s going to get cut too. Two hundred and ninety-six million dollars in assistance to state and local law enforcement, that‘s going to get cut $415 million.
Now, what‘s this? The cops are going to be gone?
Well, I tell you what‘s going to happen. There‘s going to be less equipment. There‘s not going to be as many manpower hours. There‘s going to be less money out there for communities to coordinate in dealing with big crimes and dealing with all kinds of—well, missing persons. Does that count? Are the Republicans—do they care about that?
Yes, this is happening under a Democratic president. This is sad. The cops program goes back to the mid-‘90s when the Clinton administration put 100,000 new cops on the beat and, of course, city councils could pay some of that and it was proportioned through the years. That money is going to be cut big time. It‘s only $415 million.
What‘s that mean? That means if you‘re in a small town and you count on federal money to get a couple extra officers, they‘re not going to be there. So, your local taxes have a chance of going up on this.
Here‘s another one. Federal highway investment—this is going to be cut $650 million. Now, what is this? Just what is this?
Well, let‘s see. We‘re showing pictures of a bridge here. Bridges are in trouble in America.
We even had one fall down in Minnesota that killed 13 people and injured 45. That was back in August of 2007.
And at the time, this country did a survey on bridges in America. We found out that 12 percent of the bridges in this country were structurally deficient and, by the way, a report came out just a couple of weeks ago that said the same thing. And it also said that 69,000 bridges in this country need major repairs.
And it also said in that report that bridges in this country on an average are 42 years old and they‘re structurally supposed to have a life span of 50 years. But I guess we‘ll wait. We‘ll wait.
You know, your highway funds are kind of big. It always helps in economic development. And it‘s always good to know that you can be crossing a bridge in America that‘s going to be safe.
Oh, we got more cuts. Community health centers are going to lose $600 million. I know about these folks. I went to these health care clinics, but that was a different program. This is in your community.
Six hundred million dollars—now, you know who these folks are? They‘re the elderly, they‘re the poor, they‘re the homeless, they‘re the uninsured, they are the under insured. Some people have insurance but if they have a big medical issue and they can‘t afford that, they‘ll go to programs such as this.
We have 50 million people in this country who do not have health insurance and you may ask the question, where do they go? They go right here.
But you see, the Republicans have forced a Democratic president and a Democratic Senate to say, “All right, this is the deal we‘ll do so you don‘t shut down the government.” This is happening on a liberal watch? I mean, if President Obama tomorrow in his speech talks about Medicare, Medicaid, and Social Security, he will do what other Republican presidents never did and that‘s put the big three on the table. We‘ll talk about that in the second block of tonight‘s program.
But getting back to all of these cuts that Boehner and the Republicans want, you know what they want to do with that money? They want to give it to rich people. They want to cut the personal income tax rate from 35 percent down to 25 percent. And over a decade, that would mean that the wealthiest Americans would have a 14 percent cut in their obligation.
And you want to know why the hell we have money problems in this country? It‘s the have and the have-nots. It‘s the two Americas. It‘s a distorted priority list.
And the Democrats are going to go along with this?
President Obama, tomorrow, my friend, you‘ve got a defining moment in your presidency. I hear it on the radio every day. And we‘re not whacked out lefties. We‘re Americans.
These people that were going through these cuts we just showed you, they‘re Americans. They voted, too. Don‘t they get a stake in the game at all?
But you see? When you deal with the elderly, when you deal with the poor, when you deal with students, when you deal with the disabled, you are dealing with people that have absolutely no political power in Washington whatsoever. They can‘t line the pockets of anybody. Hell, they‘re trying to line their own pockets.
What do you say we just cut them and give the Republicans what they want and that‘s more tax cuts to the top 2 percent? Because you know why? Bush told us they would be the job creators out there. It‘s the job creators. We got to help them out.
They have this theory which has failed that if we give more money to the rich people, they‘re going to go create jobs. Think about that.
The Republicans actually know what people are going to do with their money, but they sure as hell don‘t want to help out the 99ers and they sure as hell don‘t want to help out the downtrodden or people who have lost their jobs. But they know what people are going to do with their money because they‘re going to give it to the top 2 percent and they‘re going to go out and create those jobs. Yes?
Well, guess what? I showed you the graph last night, didn‘t you—didn‘t I, about where all those tax cuts went and how many jobs were created. I mean, if the Republicans were correct in the last eight years before Barack Obama came in, we should have been on a roll on job creation. We shouldn‘t have had any of these problems on Wall Street. We should have been worried about AIG but everything just kind of got out of hand, you know?
Get your cell phones out. I want to know what you think about our question tonight. And it is. Should the Democrats vote for this damn budget deal? Text “A” for yes, text “B” for no to 622639, or go to our new blog at Ed.MSNBC.com.
No they shouldn‘t vote for it. How can they call themselves Democrats and vote for something like this? This is Cave City, USA.
I‘ll bring you the details later in the show.
Joining me now is Senator Bernie Sanders, independent from Vermont.
Senator, good to have you with us tonight. You have announced that you are not going to vote for this deal. I commend you for that big time, Senator.
But the big question of the hour is: are you going to filibuster it?
What about that, Bernie?
SEN. BERNIE SANDERS (I), VERMONT: Well, I think I‘m going to save my ammunition for the fight that‘s going to take place right after this budget is passed. And that is going to be the Ryan budget, which is beyond comprehension, as you indicated. It would lower taxes for the very richest people in this country from 35 percent to 25 percent; lower corporate taxes, the same way; voucherize Medicare so that if you are a senior citizen, you will get $8,000 for an insurance company plan.
Now, if you are 75, you got cancer, you tell me what an $8,000 plan is going to cover for you? Not very much. And all of the studies indicate huge amounts of money are going to come out of seniors‘ pockets for health care—
SANDERS: -- which many seniors don‘t have.
So, to answer your question, Ed.
SANDERS: What we have seen in December is huge tax breaks to the wealthiest people. What we have seen as you very appropriately enunciated, major cutbacks in programs for our infrastructure and for working people.
Now, what we are going on to is even worse and the Republicans‘ plan on blackmailing this country and saying we are not going to raise—vote to raise the debt ceiling unless you make savage cuts on working people and give tax breaks to the rich.
SCHULTZ: Well, the bottom line here, Senator, is that the Tea Party has won the first round.
SANDERS: Yes, and the second round.
SCHULTZ: And if they win the third round, it‘s over in my opinion. So, you‘re not going to filibuster but you‘re not going to vote in favor of this, obviously.
SANDERS: Right. I certainly am not going to vote against it. I‘m going to fight against it.
But I think they have the votes to pass it. I think the fight right now, Ed—and you‘re doing a great job—is to rally the American people and say, we‘re not going to give more tax breaks to billionaires and devastate programs that we have fought for for decades for middle income and working families.
SCULTZ: You know, the American people, do we get to say anything about this?
Look at this number that came out today. This was a “USA Today”/Gallup poll. This was before the devil in details was released. The budget deal: 62 percent of Americans approve it, 25 percent disapprove of this budget deal. This is before they knew what the heck was being cut.
And then when it comes to raising taxes on the wealthiest Americans:
at $250,000 and above, 59 percent of the American people support that.
I think when the American people find out exactly what‘s in this they‘re not going to like it at all.
But what do you make of that number? We‘re letting the top 2 percent
and I‘m one of them—off scot-free. In fact, they want to give me more of a break. How the hell are we going to balance the books on a deal like that?
SANDERS: Ed, it is morally obscene to cut programs for the most vulnerable people in this country and give tax breaks to millionaires and billionaires, and it is bad economics as well. Every poll that I have seen suggests that the American people want shared sacrifice. You can‘t just cut education and Pell grants and infrastructure, and community health centers, and say to the wealthiest people in this country, you know what your sacrifice is, we‘re going to give you huge tax breaks—despite the fact that the rich already are getting richer while the middle class is collapsing. The American people don‘t want that.
SCHULTZ: Well—Senator, but the Republicans are saying that if we give the rich this money, they‘re going to go out and create jobs?
SANDERS: Well, Ed, we saw that movie over an eight-year period during the Bush administration and you know what the result is? We lost.
SANDERS: Five hundred thousand private sector jobs, worst job performance record in modern America.
SCHULTZ: Senator, good to have you with us tonight. I appreciate you sticking up for the working folk of America. There is no doubt about it that people like you have the facts on your side and it‘s only going to take some real brave Americans who are elected by some in this country to stand up and sound the alarm on exactly what is happening in this country. I mean, our country is just infrastructurally is just unraveling and all for the rich people. What is wrong with this country? Why are we doing this?
Senator from Vermont, Bernie Sanders, with us tonight here on THE ED
Remember to answer tonight‘s text question there at the bottom of the screen. I want to know what you think.
The cuts we just talked about could be chicken feed compared to next year, and the next few years after that if the Republicans have their way. A preview of the president‘s big address.
And later, as Scott Walker marks his 100th day in office, one of his top donors pleads guilty to a money laundering scheme—a scheme that helped Walker go to the governor‘s mansion in Wisconsin.
It‘s all coming up. Stay with us.
SCHULTZ: Be sure to check out our new blog at Ed.MSNBC.com. There, you‘re going to find links to my radio Web site WeGotEd.com, sign up Twitter and Facebook. And remember tomorrow night, we‘re going to be in Madison, Wisconsin, for a radio town hall.
What may be the defining moment of President Barack Obama‘s presidency
Rachel Maddow joins me for that discussion next. Where do we stand, liberals?
SCHULTZ: Welcome back to THE ED SHOW. Thanks for watching tonight.
President Obama gives a speech tomorrow that may be, I don‘t know, is it the defining moment of his first term as president? I think it is. I really do.
The speech comes after Republicans have offered up a budget for the next year and a blueprint for the next 10 years that is far more extreme than anything that has ever come at the American people before. This is the budget they have been dreaming of for decades.
You think President Bush was taking us into dangerous territory? Folks, let me tell you something—when they talk about privatizing Social Security, this is the real deal and it‘s going to affect millions of people.
Well, Congressman Paul Ryan, out of Wisconsin ironically, wants to end Medicare as we know it—all in the name of deficit reduction or so he would have you believe that. And he‘s got the Republican Party behind him in a big way.
And today, Speaker Boehner said tax hikes are a nonstarter for deficit reduction. So, the first block where I showed you all those cuts, they want to take all that and maybe the beneficiary the top 2 percent.
Tomorrow, President Obama will address the national debt and offer his version of how to fix this mess. What we don‘t know yet, just how much the president will draw from his bipartisan fiscal commission. But, actually, in my opinion they were a right wing fiscal commission.
But think about it this way. The Republicans put out the most extreme, partisan fiscal blueprint that we have seen in years, maybe in decades, and the president will respond tomorrow. Whether he begins from a position of strength will only determine where the next debate is going to go. I mean, how much is the president going to put on the table? Is it going to be Medicare, Medicaid, and Social Security the big three?
You know, no other Republican president has ever done that. And a lot of lefties are saying, Mr. President, dude, where are you on this?
Joining me now, my colleague whom I respect immensely, Rachel Maddow, host of “THE RACHEL MADDOW SHOW.”
RACHEL MADDOW, “TRMS” HOST: Ed, thank you for having me.
SCHULTZ: We better have a real heady discussion on whether this is OK or not. I mean, where do you think the people are? How much of a backlash is going to be on the Obama White House if they actually open the door a little bit to talk about the big three?
MADDOW: In 2005, after George W. Bush beat John Kerry, he wanted to privatize Social Security, right? So, he said that was how he was going to spend his political capital. And so, he—in 2005, did that coast to coast road show talking about privatizing Social Security.
Nancy Pelosi was just out reminding people how this went on the Democratic side last week trying to remind people about how Democrats won that one. Because what did Democrats do?
Democrats didn‘t come out and say, you know, don‘t cut Social Security with a machete. Cut it with a scalpel. You don‘t need to privatize it. But this is how we‘ll fix it. This is how we‘ll reform it. You‘re right.
There‘s problems here and this is how we‘ll handle them.
They came out and said you want to privatize Social Security? Here‘s our counteroffer. No. We have a plan. It‘s called Social Security.
Your plan is privatization. Our answer to that is no. Not an inch. We‘re not going—we‘re not going to fall for the bait. We‘re not going to go down the road that you are trying to force us down by making us admit that there‘s a problem here that needs to be fixed by your solutions.
President Obama can do that on Medicare and on the big three tomorrow.
I don‘t know if he will.
SCHULTZ: Well, if he doesn‘t—I mean, if he even opens the door, it‘s going to cost him politically, isn‘t it? I mean, there‘s a lot of people that I think have real reservations about just this guy caves on everything.
And he undoubtedly is a guy who likes to make deals. He wants to see the country come together. But isn‘t he dealing with a group that wants it their way all the time? So, can he draw a line in the sand?
MADDOW: I think President Obama is right in his calculation that people want the sense the president is the adult in the room, is the responsible party, is the person who can mediate when the other sides either are irresponsible or don‘t make sense. I think they are right that they want that political calculation.
But because Republicans know that‘s his political calculation, what they‘ve decided to do is push the envelope so far that they are all seriously signing on to killing Medicare. Killing Medicare is unimaginable, but they‘re pushing it that far because they want that to be a rational position from which he needs to triangulate. At that point, you need to stop taking conciliatory position and say no. Your position is kill it. My position is defend it.
SCHULTZ: And the Republicans have said that they will not go along with any type of tax hikes. The president is going to have to push hard for that, because all of the cuts are on know the backs of the middle class and lower income Americans, working Americans.
You‘ve documented it well. The union-busting efforts are going on. States can‘t meet budgets so they want to go after workers and taxes. And, of course, they want to reduce it another 10 percent, corporate tax, and also personal income tax.
Well, how should the president handle that tomorrow?
MADDOW: I think the president needs to talk about that as a war on math. Honestly, you can talk about the impact of this on the American people. You can talk about having a difference of ideology, but there‘s some—the real low hanging fruit there, the Heritage Foundation is the group that said that George Bush‘s tax cuts would create an increase in tax revenues. You increase revenues by cutting revenues.
Does that sound like voodoo economics? Yes. That‘s what George H.W.
Bush called it when Reagan tried to get away with it too. It‘s wrong.
It‘s made up math.
SCHULTZ: It‘s never worked.
MADDOW: It‘s never worked. It‘s been tried.
Paul Ryan‘s budget not only extends the Bush tax cuts, the disastrous Bush tax cuts which we know the president is against extending. Paul Ryan had another $2.9 trillion worth of tax cuts. He rolls tax cuts for the richest people in this country back to a level they haven‘t been since 1931 and he says the government will make money doing it. It‘s a war on math that makes no sense.
SCHULTZ: How far do you think the Democrats are going to go in pushing back against the president? I mean, Peter DeFazio said we need a Democrat in the White House to a lesser extent. We‘ve had a lot of people on the radio show, Dennis Kucinich, today, Peter Welch. I mean, there‘s a lot of discomfort right now.
SCHULTZ: What do you think the Democrats are going to do collectively?
MADDOW: I think that a lot of people are holding their breath waiting to see this speech tomorrow and they‘re going to decide based on what the president says.
SCHULTZ: So, a defining moment for the president?
MADDOW: I think it is a defining moment for the president. I honestly don‘t know what he‘s going to say. If he gets out there and says, hey, there‘s a machete-wielding maniac coming after Medicare, I‘ve decided to fend that off machete-wielding maniac with a scalpel? I‘m sorry, that is not a defensive tool. You need to step up and say back off the middle class. Back off the things that made America what it is. Medicare, Medicaid, Social Security will not be touched as long as I am president.
If you do that, Democrats will line up behind him.
SCHULTZ: Rachel, thanks for joining me tonight. I really appreciate.
MADDOW: Thanks, Ed.
SCHULTZ: Thank you so much.
After killing one rail project, Scott Walker commits millions in state money to another. IT turns out the head of the rail company that Walker gave thousands to—well, there was some hanky-panky there. Illegal activity. We‘ll get to it.
When planes are ramming into each other on the runway, you know it might be a good idea not to cut that federal aviation budget. Air traffic controllers might have been able to stop that. We don‘t know. An investigation will show. But House Republicans have a different opinion.
And “The Takedown” is next. Stay with us.
SCHULTZ: Time for “The Takedown” on THE ED SHOW tonight.
Democrats want to increase funding to the Federal Aviation Administration for improved safety programs and they want to build this new satellite-based air traffic control network. You know, stuff that would help protect Americans and only 1.5 million American passengers per day in the airline industry. Kind of important, don‘t you think?
Well, House Republicans on the other hand, well, they want to cut about $4 billion in aviation funding. Well, Transportation and Infrastructure Committee Chairman John Mica pushed an aviation bill through the House last month. It‘s vastly different than a version passed by the Senate in February.
Congressman Mica defending the spending cuts, which would lead to fewer air traffic controllers during overnight hours.
(BEGIN VIDEO CLIP)
REP. JOHN MICA ®, FLORIDA: Do we need to double up? Do we need to double up when there is no air traffic at most of these airports between the hours of midnight and 5:00 a.m.? That‘s the Washington—big spending, big government. Let‘s add more.
(END VIDEO CLIP)
SCHULTZ: Stop right there. As a pilot, I have to say that safety is paramount. And I am infuriated and offended.
I‘d like to know if Congressman Mica is a pilot, if he has ever worked with an air traffic controller under duress. Has he ever been in a tight situation in the air? I don‘t know. I‘m off script right now but it just infuriates me when these guys get up and think they know what the hell they‘re talking about.
Look, we need to have major airports in this country with air traffic controllers 24/7. Why? Because it saves lives. And it also saves lives of the people on the ground.
All right. Back to live action. But it‘s not just big government in Washington voicing displeasure with the cuts. Some people who are charged with keeping us safe in the skies think that the Republican cuts are dangerous.
Here‘s a guy with experience, Captain Chesley “Sully” Sullenberger, who safely landed the damaged passenger plane in the Hudson River, told THE ED SHOW that cuts would, of course, jeopardize people‘s lives.
(BEGIN VIDEO CLIP)
CAPT. CHESLEY “SULLENBERGER, AIRPLANE PILOT: This bill is disturbing in many ways. It would essentially freeze our safety regulations in time by erecting so many barriers and obstacles and high hurdles that only the cheapest and most innocuous safety rules would likely be put forward.
(END VIDEO CLIP)
SCHULTZ: Do Republicans really want to make it harder to put air safety rules in place? I wonder what the 223 congressional members who voted for the House bill thought when they saw this video.
That‘s an Air France plane on the runway at JFK last night. There were 510 people onboard. And that‘s a Com Air plane carrying 56 people getting clipped and, of course, spun around. Thankfully, no injuries were reported and the incident is under investigation.
But, of course, cutting back air traffic controllers, you know, stuff like that can happen. So, with safety issues at stake and the White House threatening to veto a final bill that includes the spending cuts why did Republicans pass their measure? Well, it‘s because their bill also includes—here we go—language making it harder for airline employees to join the damn union.
So, the spending cuts, there‘s bargaining chip here isn‘t there? They can take the cuts off the table as long as the final bill helps bust all the union workers and keep them from even thinking about joining.
Some elected officials in Washington think so little of our well being, they‘ll use our safety as a leverage in negotiation. Whatever happened to not negotiating with hostage takers? That‘s “The Takedown” tonight.
Four dollar a gallon gas is in the rear view mirror and $5 a gallon gas is on the horizon. A major financial power house admits that Wall Street—Wall Street not the Middle East—is driving up the price.
Scott Walker claims his state is broke yet he found millions of dollars in grants for a major campaign donor—a donor who gave to Walker illegally. John Nichols has the story, Washington correspondent of “The Nation.” That‘s next.
Stay with us.
SCHULTZ: Welcome back to THE ED SHOW. Thanks for watching tonight.
Ah, Wisconsin, the state that just keeps on giving the news business more stories.
In one of his first moves as governor—you won‘t believe this—
Scott Walker killed a high speed rail project for the state of Wisconsin. He rejected $810 million in federal funding. This, of course, caught the attention of a lot of Wisconsinites. It‘s kind of a head scratcher considering the project would have created jobs and improved the state‘s business climate and, certainly, economic development in rural areas.
But Walker had his eye on another rail project, specifically strengthening ties with a company called Wisconsin & Southern Railroad.
Listen up, folks. The company runs hundreds of miles of state-owned rail. And last month, the Walker administration gave the company $14 million in state grants for infrastructure improvements.
Well, it turns out the company‘s president, Bill Gardner, he just happens to be a major Walker donor. In fact, during Walker‘s campaign, Gardner e-mailed him this—an offer. He says, “I will do everything I can to get you in the governor‘s mansion.”
Pretty straight talker, isn‘t he? That meant supplying Walker with tens of thousands of dollars in campaign funds. Now, a criminal complaint alleges Gardner did so illegally.
Gardner‘s own donation surpassed the state‘s $10,000 limit. So, what did he do? Gardner asked his employees to donate to Walker to the tune of $5,000 apiece. Gardner then reimbursed himself and the employees with the company money.
An investigation was launched last year after Gardner‘s ex-girlfriend, ah-ha, told election officials about her ex-boyfriend‘s donations. Doggone it! A little love circle got him in trouble, huh?
He has now agreed to plead guilty, guilty on two felony counts as part of a deal. Meanwhile, his company has paid a six-figure penalty. Who do you think had this story?
Now, it‘s time to call in Washington correspondent for “The Nation,” John Nichols.
John, great reporting on this. You‘ve done some outstanding work on this, my friend.
You write that Walker, the campaign, has returned nearly $45,000 to Gardner during the early stages of the investigation. Explain why we‘re just starting to find out about all of this.
JOHN NICHOLS, THE NATION: It‘s really a fascinating story, Ed. Bill Gardner got caught out on this better part of a year ago when his girlfriend ratted him out. That started a very long and detailed investigation.
Once it began, the Walker campaign realized they had to get that money out of their accounts pretty quick. But they didn‘t get all the Gardner money out and also they maintained this ongoing relationship.
Remarkably enough, when they got in trouble last year on taking money from Gardner, it wasn‘t the first time that it happened. Back in 2005 when Walker was thinking of running for governor, they got an illegal contribution from Gardner and had to return that one, too. So, it‘s a long-term relationship.
SCHULTZ: Yes. Do you think there is a connection between the rejection of the stimulus money that would have put a high speed rail system in Wisconsin in this relationship to a big donor? What do you make of it?
NICHOLS: I think it‘s a relationship to a couple big donors, Ed. This is one place where the governor said, oh, we don‘t want any of that federal money and yet he is paying out state money to a donor from Wisconsin & Southern Railroad.
But I think the bigger donor he was concerned about or donors that he‘s concerned about are the road builders because while this governor is turning down rail money, he is moving state money into huge new road construction projects. So, the fact of the matter is, what you see is a pattern where the governor turns down public money that could do great infrastructure projects and serve the state very well in job building, but keeps turning state money back over to private folks who happen to be big donors to his campaign.
SCHULTZ: And on Thursday, Scott Walker the governor of Wisconsin, is going to be trotted up on Capitol Hill in front of Darrell Issa‘s government and oversight committee as a model of how to take care of state budgets. And, of course, he‘s going to get the flower treatment from the Republicans. Is this story going to haunt this governor?
NICHOLS: Well, the story has already haunted this governor. The fact of the matter is there is no governor in the country who has seen so deep a drop in his approval ratings from the time he came in to now.
The people of this state are very, very upset with what he‘s done. He‘s divided his state. He‘s created all sorts of problems for Wisconsin and to become an international story. It would be fascinating and valuable if the Issa committee members began to really ask him questions about how broke Wisconsin is and how—
SCHULTZ: Why else would that—but why else would that rail executive go so far to try to try to get Walker into the governor‘s mansion just because he‘s a nice guy if he knew he wasn‘t going to get some kind of beneficiary out of it? You know what I mean?
NICHOLS: Well, of course, Ed. And, look, this is the thing—this governor keeps turning down federal money for rail, for broadband build out, again and again. And he says, oh, we don‘t want that federal money there. But then he keeps finding state money to benefit his donors.
SCHULTZ: You bet. John, good to have you with us tonight. Great reporting. Thanks for joining us.
And a reminder, I‘m going to be holding a radio town hall meeting tomorrow night in Madison, Wisconsin, at the Barrymore Theater, from 6:30 to 8:00 p.m. It‘s free. It‘s open to the public first come, first serve. We want to hear your voices on stories like this.
CEO pay was pretty healthy under president—under the last president. And the tax rate on the wealthiest individuals was higher than it is now. So, why do we keep buying into this Republican myth? Stay with us. I got some more chalk board stuff coming up on this one.
SCHULTZ: And it‘s not too late to let us know what you think.
Tonight‘s text question: Should the Democrats vote for the budget deal? Text “A” for yes, text “B” for no, 622639. Our blog Ed.MSNBC.com. Results coming up.
And if you liked my chart last night, wait until you see the dandy I got planned for you next. I mean it‘s a tell-all dude. Do you know what I mean? Be right back.
SCHULTZ: Welcome back to THE ED SHOW.
Before we start this segment I want to point out that our team has confirmed that Congressman Mica is not a pilot. I was right. He didn‘t know what the hell he was talking about. I think I‘m going to follow up on that story tomorrow. I can‘t wait.
All right. We got a huge response from just a simple graph we did last night on this program. We got a couple more we want to share with you tonight. So, you better be sitting down for this one because I think the numbers are staggering.
We begin with a couple of headlines. “CEO pay soars while workers‘ pay stalls.” The drought is over, at least for CEOs.
The bottom line? Median pay for CEOs jumped 27 percent in 2010, but workers in private industry saw their pay grow 2 percent. That‘s right—
2 percent. No hogs there, you know? You think there might have been a lesson in that somewhere?
Now, let‘s look at CEO pay through the decades. This is executive compensation in millions for the top 50 U.S. firms. I mean we didn‘t have any greedy people down here, did we? It bumped up in the 1980s when Reagan showed up. It bumped up and even doubled in the ‘90s during the Clinton years.
And so, President Clinton said, man, you guys are making some money. He ushered in a tax policy that asks just a little bit more from these guys that went from $4.1 million to $9.2 million.
Here‘s President Clinton‘s address before the Congress asking for more.
(BEGIN VIDEO CLIP)
WILLIAM J. CLINTON, FORMER U.S. PRESIDENT: For the wealthiest, those earning more than $180,000 per year, I ask you all who are listening tonight to support a raise in the top rate for federal income taxes from 31 percent to 36 percent. We recommend—
CLINTON: -- a 10 percent surtax on incomes over $250,000 a year.
(END VIDEO CLIP)
SCHULTZ: So, it looks like CEOs did pretty well in the ‘90s. And the economy if I remember correctly created 22 million jobs back then. And, you know, we wound up with the government surplus. I don‘t know if anybody is scoring at home on the numbers.
But President George W. Bush—well, he wasn‘t too impressed with that kind of job growth. And he lowered taxes, of course.
Here‘s his first address before the Congress talking about his tax reform that would add more jobs.
(BEGIN VIDEO CLIP)
GEORGE W. BUSH, FORMER U.S. PRESIDENT: This reform will be welcomed relief for America‘s small businesses, which often taxes at the highest rate, and help for small business means jobs for Americans.
(END VIDEO CLIP)
SCHULTZ: Well, one thing for sure, going back to our graph here, CEO compensation, well, it went right back up during the Bush years, didn‘t it? The $8.5 million average pay. New jobs, not so much.
Now, bear with me because I want to bring back another graph we showed you a few weeks ago. This one shows how badly middle class income has declined over the decades.
Let‘s take you back to 1967. And here we go. We‘ve got a decline.
This is union membership in red and this is middle class national income average. And it just sinks as we go right along through the decades. That‘s how it went.
Now, if you put these two charts together, this is what it‘s going to look like. Middle class income shrinking, executive pay—whoa! Here it comes. We had a president in office now who seems to understand the problem and at least as a candidate he wanted to do something about it.
(BEGIN VIDEO CLIP)
BARACK OBAMA, PRESIDENT OF THE UNITED STATES: Washington where George Bush handed out billions of dollars of tax breaks to the wealthy few over the course of 7 ½ years. John McCain promises to make those same tax cuts permanent.
(END VIDEO CLIP)
SCHULTZ: Heck of a graph, isn‘t it? It tells the story. I know the president still says that the wealthy should pay more. Let‘s hope that he sticks to that conviction, because in an economy that is benefiting only the wealthy, it is—is it too much to ask the wealthy to pay a little bit more in taxes or will the administration just fall into this trap one more time?
(BEGIN VIDEO CLIP)
REP. JOHN BOEHNER (R-OH), SPEAKER OF THE HOUSE: We fought to keep government spending down because it really will in fact help create a better environment for job creators in our country.
(END VIDEO CLIP)
SCHULTZ: Major investment firm finally admits that we‘ve been saying all along—what we‘ve been saying, Wall Street speculators are driving up the price of gasoline. Former commodities trader Dan Dicker will help me just pull the curtain back so everybody can see what the heck‘s going on with gas prices.
Stay with us. That‘s next.
SCHULTZ: And, finally, tonight, gas prices. Just what the heck is going on? Some economists are predicting that major U.S. cities may see $5 a gallon gasoline by Memorial Day weekend. Hello?
And whenever those reports come out, it‘s no surprise to see headlines like this one over at FOXNews.com. As gas prices rise, it‘s time to “drill baby drill.”
But the Department of Energy just released figures showing gasoline demand is down from last year while average prices are almost a third higher. So, it‘s not supply and demand. We‘ve been telling you for weeks that Wall Street speculators are driving up the cost of oil.
And yesterday, Goldman Sachs helped prove it. The investment giant told clients to sell commodities estimating that speculators are boosting crude prices as much as $27 a barrel. This follows a Goldman Sachs research note last month that found speculators pushed the price as much as 10 cents for every million barrels they held.
Joining me tonight is Dan Dicker. He was a commodities trader on Wall Street for some 20 years, and is author of “Oil‘s Endless Bid: Taming the Unreliable Price of Oil to Secure Our Economy.”
Dan, thanks for joining us tonight.
DAN DICKER, “OIL‘S ENDLESS BID” AUTHOR: Thank you, Ed.
SCHULTZ: Make the folks at home that don‘t understand Wall Street and speculation and the nuances of it all, what‘s going on here?
DICKER: I‘ll make it very simple, Ed. We have is we have a bunch of money just coming in trying to buy oil as if it was a stock, and these are using instruments that Wall Street creates and Wall Street sells. And the idea is to drive as much money as they can into buying oil as another asset class, something else that they can trade-off of and make money.
Now, we‘ve had this happening for the last 10 years, but it‘s happened very quickly in the last five, particularly in what they call index investments. We‘ve gone from basically zero to $350 billion of index investment into oil and other commodities.
Now, the problem with this is that the difference between a commodity like oil and a stock is that for a stock, you don‘t need another side of the trade. But for oil, you need to find sellers. In fact, you can‘t find sellers in oil with all these people just rushing in to buy, all the traders, all investors, all pension plans, all the airlines, all the heating oil distributors, all the people making aluminum, everybody out there doing refrigeration, making drugs, they‘re all buyers.
So, what you have in essence to make it simple is a whole group of people coming into a neighborhood where everybody has a house and everybody‘s house is worth $200,000 and everybody‘s happy with their house.
But the problem is everybody wants to buy this house, and the only way you can get someone out of the house they‘re happy with that‘s worth $200,000 is to pay $300,000, $400,000, half a million dollars for this house, and that‘s what is going on with oil.
SCHULTZ: It is not supply and demand, bottom line.
DICKER: Bottom line, it is not.
SCHULTZ: OK. This is the president speaking Wednesday about gas prices. Here it is.
(BEGIN VIDEO CLIP)
OBAMA: You add on top of that what‘s happening in the Middle East, and it makes folks nervous. And so, these folks start saying, you know what? I‘m going to bid a higher price on oil on a barrel of oil now because I‘m thinking it‘s going to go up a little further in case something happens on the world oil markets—and that pushes prices up just a little bit more.
(END VIDEO CLIP)
SCHULTZ: He knows what‘s going on, and he can do something about it, can‘t he?
DICKER: Well, I‘m not sure if he can do something about it. What‘s happened is, of course, Dodd-Frank has given to the CFTC the mandate to put rules in for oil prices and put rules into place that were mandated to be in place by February of this year. Now, obviously, they haven‘t done that.
Why haven‘t they done that? Well, they‘ve gotten an enormous amount of pushback from some of the people that you talk about, including Goldman Sachs and Morgan Stanley, PIMCO, the FIA, a whole bunch of organizations who have been pushing back against the CFTC on writing these rules.
So, what we have is a CFTC that cannot complete the mandate that they have and, in fact, they‘re not even going to look at some of this stuff until next year.
SCHULTZ: So, will we see $5 a gallon gas this summer?
DICKER: I think there‘s no doubt about it, Ed.
DICKER: All of this money continues to come in.
DICKER: There‘s nothing really to stop it. You‘ve got a lot of reasons why more money will throw in.
SCHULTZ: Dan Dicker, great to have you with us tonight.
Tonight, in our survey, I asked: should the Democrats vote for the budget deal? Eight percent of you said yes, 92 percent of you said no.
That‘s THE ED SHOW. I‘m Ed Schultz. See you tomorrow night, as we head to Madison, Wisconsin—town hall meeting at the Barrymore Theater 6:30 to 8:00.
“THE LAST WORD” with Lawrence O‘Donnell starts right now.
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
Copyright 2011 CQ-Roll Call, Inc. All materials herein are protected by United States copyright law and may not be reproduced, distributed, transmitted, displayed, published or broadcast without the prior written permission of CQ-Roll Call. You may not alter or remove any trademark, copyright or other notice from copies of the content.> PASTE THE TRANSCRIPT HERE
Copyright 2011 CQ-Roll Call, Inc. All materials herein are protected by
United States copyright law and may not be reproduced, distributed,
transmitted, displayed, published or broadcast without the prior written
permission of CQ-Roll Call. You may not alter or remove any trademark,
copyright or other notice from copies of the content.>
PASTE THE TRANSCRIPT HERE